Maintenance at Panama Canal to cut transit capacity Aug 25-26: ACP

Houston — Clean tanker market participants have reported extended waiting times for transit slots through the Panama Canal in August, due in part to increased vessel flow in the region and routine maintenance that will decrease the transit allotment between Aug. 25-26 to 21-23 ships daily, according to a spokeswoman for the Panama Canal Authority.

The spokeswoman for the canal authority, or ACP, said the Panamax locks are due to undergo routine maintenance Aug. 25-26 and that during this time ships may experience delays in transiting, though the Neopanamax locks will be unaffected during the period. Daily transits through the Panamax locks typically number between 32-34 ships. The spokeswoman said that the dates are tentative and can be postponed depending on expected wait times and transit times.

Shipowners have said for tankers loading on the US Gulf Coast and planning to transit through the Panama Canal, the waiting time between arrival at the canal and a scheduled transit time has increased to between six to eight days, depending on the time of scheduling. Previously, a tanker owner could expect wait two to three days before its transit time, according to market participants.

The ACP website showed three available south-bound slots for super-classed vessels, which includes Medium Range and Long Range 1 clean tankers, on Aug. 21. The next available slots for super-classed vessels were on Aug. 30 with two open South-bound transit times, and thereafter slots were only open in September dates.

Shippers were originally informed of the Panamax locks maintenance Aug. 6 and further advisories will be sent with more specific details before maintenance begins, the spokeswoman said.

Effects on freight yet to be seen

USGC-loading spot clean freight has not yet been directly effected by the extended wait times, however should wait times for transit slots increase further, more ships would be taken out of the spot pool, tightening tonnage.

Shipowners with tankers positioned in the Americas have enjoyed a recent bout of bullish activity in the historically weak summer season, with petroleum product demand increasing slowly in Latin and South America as countries return from stay-home orders. Additionally, record high stocks of ULSD in the USGC has prompted exports to increase amid dismal product demand in the USGC.

The 38,000 mt USGC-Chile route was assessed at lump sum $1.575 million Aug. 17, having increased 12.5% week on week.